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Why does incentive compensation require special expertise?

Why does incentive compensation require special expertise?
April 25, 2023

Incentive compensation expertise

For over two and a half decades, Primeum has been building up its expertise in incentive compensation. From assessment to the implementation of effective systems, the calculation of bonuses and their day-to-day management, we aim to offer our clients comprehensive solutions based on incentive compensation – an increasingly strategic issue for companies looking to improve their performance.

To offer the best possible solutions to the problems encountered by our clients, we decided from the very beginning of our operations to provide original technical solutions to meet human needs. They’re designed to motivate employees – whatever their position – to make an effort to achieve the performance their company expects.

To this end, we needed to combine knowledge of behavioural, management and social issues with technical know-how of the statistical and financial parameters that make it possible to smoothly implement internal pay reviews.
Primeum’s know-how is based on the application of a rigorous analytical method that draws on a wide range of expertise to address all the issues surrounding incentive compensation.

We have a comprehensive vision and adopt a global approach: 

  • Technical analysis of the strengths and weaknesses of existing systems
  • Qualitative analysis: we look at all the incentives produced
  • Incentive compensation policy: we prepare specifications
  • Implementation of innovative calculation processes (if necessary)
  • Statistical financial simulations of the behaviour of the budget allocation
  • Assistance with presenting systems to staff representative bodies and producing requested figures
  • Assistance in designing communication materials
  • Analyses and quick-win advice by payment cycle after roll-out
  • Deployment of dedicated calculation solutions incorporating all operational complexities
  • Deployment of leadership solutions accessible to everyone on smartphones/tablets/PCs.

1) Analysis is at the heart of our approach

First of all, to fully understand the issues relating to the implementation of incentive compensation in an organisation, we set about assessing the existing situation. This assessment, which is both quantitative and/or qualitative, allows us to measure the effectiveness of the existing compensation systems and to identify their true impact on the performance and motivation of the various teams. It also allows us to alert the various decision-makers in the company to the importance of the changes to be made.

2) An incentive compensation policy to stick to strategic priorities and develop specific requirements 

Once the assessment is complete, we create an incentive compensation policy which is adapted and personalised to the company’s needs. The company’s strategic goals are taken into account in the remuneration policy and become part of the company’s development by helping it to achieve its growth or transformation objectives in the short, medium and long term. This projection phase results in precise specifications for the incentives that the systems should produce over the next two to three years.


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3) A technical design that anticipates the behaviour of the mechanisms in place

The next stage of the project then involves designing clear and effective prototype bonus systems. Our experts therefore faithfully translate the incentive compensation policy created with the client into different prototype incentive compensation plans.

The creation of these prototypes is based on four key points:

  • The creation of these prototypes is based on four key points:
  • The choice of the different performance indicators to be evaluated and measured
  • The choice of the performance period over which each criterion is evaluated
  • The implementation of scales and remuneration curves for each criterion
  • Simulations of the budgetary behaviour to anticipate the expenses of the new incentive compensation plans.

4) Unique know-how that makes a difference

Once the new bonus plans have been designed, our teams support companies as they roll them out. Experienced in change management, our specialists support you with the communication work required for the deployment of these new mechanisms by providing:

5) Special software for calculating bonuses and targets

Primeum provides its clients with dedicated tools to efficiently calculate bonuses and targets.

  • These dedicated tools enable the entire computation process to be carried out in one click and monitored
  • Extraction of commercial and HR data, followed by consolidation and formatting checks
  • Data validation/correction workflow
  • Management evaluation workflow
  • Performance and bonus calculations
  • Generation of reports for the various stakeholders (beneficiaries, managers, HR, sales, finance departments etc.)
  • Validation and communication of results
  • Traceability, record-keeping and compliance

To help you get to grips with and use the bonus calculation tools, our experts will guide you through a personalised follow-up session. This sense of service, developed since the creation of our firm, means that we can outsource the calculation of your bonuses under the best conditions.

6) Going further by offering to manage your schemes using an innovative dedicated tool

Our software as a service (or SaaS), the Incentive Tracker, manages schemes so that they can be easily handled by teams. In this way, each beneficiary, regardless of their profile and function, can carry out individual performance simulations and estimate the associated bonuses.

This digital tool is a real motivator, allowing employees to simulate their performance and bonuses and project future gains!

7) Follow-up to maximise performance

Finally, rigorous reporting is the cornerstone of good incentive compensation management. We place great importance on monitoring the various performance indicators that measure the effectiveness of your incentive compensation. This way, we can monitor and measure the results of your new incentive compensation system. This dynamic monitoring makes us responsive to any corrective actions required to make your incentive compensation more efficient while helping you achieve the desired objective(s).

Incentive compensation, a discipline at the crossroads of numerous corporate issues

Business management, human resources and employment law: a multidimensional issue

Because incentive compensation involves several different skills and is at the intersection of different strategic issues, we are regularly asked about more general HR issues such as overall pay packages.

Our experts can therefore use their experience to share with you general and sectoral best practices, both in terms of fixed-variable balance and the correct application of schemes such as profit-sharing. We help companies adapt their incentive compensation practices to the market, their HR strategy and their employees’ behaviour.

We also deal with the contractual implementation of incentive compensation plans and the impact of the changes envisaged. Without overhauling your employment contract policy, we share with you our legal best practices based on our observations and feedback on the subject.

Introducing a new incentive compensation system frequently involves reviewing existing sales management systems. It’s not Primeum’s role to create sales management tools.

However, when developing and deploying our incentive compensation calculation and management tools, we need to take account of the indicators available, the frequency of refreshment and the completeness of the data. In this context, we can help you think about how to manage the associated sales tool. Primeum therefore assists companies in examining the close link between incentive compensation and sales management.

Integrated, multi-disciplinary teams

With skills in mathematical and statistical modelling, project management, methodological design and change management, our multidisciplinary teams provide a clear and comprehensive response to the problems encountered by our clients.

Our specialist consultants are committed to the implementation of your new incentive compensation plan, from design to deployment and change management. Our expert change management consultants work in conjunction with technical teams of project managers specialising in data management and optimisation. From data diagrams to the automation of data circulation processes (upward and downward), the automation of calculations, the creation of accurate and regular reports for all business lines, these technical project managers are directly involved in the continuous improvement of the processes implemented by our clients in conjunction with our organisational strategy experts.

Our incentive compensation systems, which combine psychological and sociological skills in motivation and mobilisation with statistical and mathematical skills relating to efficiency and budgetary control, bring our consultants and project managers closer to operational teams, thereby rigorously producing the incentive effects that our clients need.


Tell us about your project  Let's take the time to talk together to share your concerns and give you our  vision. Herve de Riberolles - Incentive compensation expert  Make an appointment


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Blog post author

Hervé de Riberolles

For more than ten years, I have been leading a number of projects for our customers to diagnose and re design the incentive compensation systems of their teams. The diversity of environments (sectors, countries, populations) that we face, my team and myself, requires a perpetual adaptation of our methods and our offer. The motivation of employees is, from my point of view, exciting, constantly evolving and at the crossroads of several areas of expertise. That's what makes it so interesting.

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